How Do Companies Develop Habit-Forming Products?

This week, Stanford GSB’s Social Web Strategist Karen Lee is sharing her class notes from a Week 0 course called “How Neuroscience Influences Human Behavior,” co-taught by Marketing Professor Baba Shiv and Lecturer Nir Eyal. Each post focuses on an interesting insight from class. 

In yesterday’s post, we examined why habits can be good for business and looked at how Google and Amazon successfully created user habits based on two critical factors: frequency and utility. Today I’m exploring the mechanics of how habits are formed and how companies can apply this framework to their businesses and products. 

Businesses that are successful at engaging users know how to tap into the fundamental driver of habits - desire. Frequency, utility and engagement all make up the elements of desire. Nir Eyal (who co-teaches this class and graduated from the GSB in 2008) developed this virtuous cycle called the “Desire Engine,” which is comprised of 4 parts: trigger, behavior, reward and investment. 

Class Slides: Using Neuroscience to Influence Behavior

The Desire Engine serves as a helpful framework on how to develop a habit-forming product. More about it on Nir Eyal’s blog post How to Manufacture Desire.

Desire is the reason people come back for more and engagement is the mechanism that drives repeated behaviors. Through repetition, these behaviors can evolve into habits over time. (Side note: engagement speaks more to the variable reward and investment parts of the Desire Engine, which I’ll elaborate more on in tomorrow’s post.) 

In class, we went through a simple exercise to identify products we use that are triggered by our feelings: “Every time I (feel a certain emotion or verb), I use (product).”

Interestingly, negative emotions are powerful triggers because people naturally seek ways to get out of negative states. For example, it’s uncomfortable feeling unsure about something. If I didn’t know who the Giants played against in the 2010 World Series, my first inclination is to “google” it in my Chrome’s address bar or use my Google Search app on my phone. Within seconds, the search results rewarded me with the answer (the Texas Rangers), resolved my negative state of feeling uncertain and strengthened my habit of using Google the next time I feel unsure.   

Software, social and entertainment companies have developed really successful habit-forming technologies.  

A deeper approach for identifying triggers for your business is through what Twitter and Square co-founder Jack Dorsey calls “user narratives.” In a lecture with the Stanford Technology Ventures Program, he said they spend a lot of time writing narratives about the experience people are going to have, so the story unfolds like a play. The plot, place and action in these narratives can be translated into triggers for your products. More importantly, it helps companies develop better user experiences and stickier products. 

My next post will cover motivation concepts and why gamification is an effective way to drive engagement and create habit-forming products.


Karen Lee is the Social Web Strategist at the Stanford GSB. She blogs about social media and business research at and tweets from @karenlee.